The Proposal Process

1. Contact the Office of Corporate and Foundation Relations before proceeding with your proposal preparation. Plan to discuss your project, the areas in which you may need assistance, your ideas for possible funding sources, and your timeline. You will be advised to seek approval from your Division Chair and the Provost.
2. Discuss your project with your Chair for approval followed by the Provost. They should each send an e-mail to the Office of Corporate and Foundation Relations (silverman@babson.edu) indicating their authorization for you to move forward on Babson’s behalf with a proposal.
3. All proposals for grants that will be administered by Babson College (where funds are to be paid to and disbursed by the College) must be reviewed and approved before they are submitted to the funding agency. This approval process usually takes a full five business days and should be factored into your proposal planning.
4. When your proposal is in its final form and at least five business days before your submission date, submit to the Office of Corporate and Foundation Relations in Alumni Hall a copy of the following materials: Full proposal; Final budget; Attachments; Institutional Approval Form signed by you and your Division Chair (see below).
5. The Office of Corporate and Foundation Relations will review your proposal and budget to ensure it is ready for submission. A copy will be forwarded to the Budget and Financial Services Office for their review and sign off. The Office of Corporate and Foundation Relations will obtain the Provost’s signature on the Approval Form and will obtain a transmittal letter from the appropriate individual (President, Provost or Dean).
6. The Office of Corporate and Foundation Relations will then make the required number of copies, supply additional Babson documents as required, and will UPS, mail or upload (for electronic submissions) the completed proposal in time to meet the deadline.

Costs on sponsored projects are divided into two major categories:

1. Direct costs
2. Facilities and administrative (F&A) costs—sometimes referred to as “indirect costs” or “overhead.”

Since the federal government uses the term “F&A costs” in all their documentation, we will also use “F&A costs” for the rest of this discussion.

Direct Costs

Direct costs are those costs that can be identified specifically with a particular sponsored project relatively easily and with a high degree of accuracy.

F&A Costs

F&A costs are project costs that cannot be readily and specifically identified on a particular sponsored project. F&A costs include, for example, the services of the Corporate, Foundation and Government Relations Office and the grant administrator, the services of the purchasing and accounting offices, building depreciation, library facilities, interest expense, utilities, telephone and fax usage, e-mail, general office supplies, copying charges, etc.

A formal and extensive set of guidelines for determining F&A costs are issued by the Office of Management and Budget in Circular A-21. The Circular A-21 guidelines include formal criteria for justifying costs, methods for distributing the costs between instruction and research, and documentation requirements. In addition, certain costs are declared as unallowable.

The faculty member’s proposal addresses the direct cost elements only, and the direct cost commitment to the faculty member must be supplemented to pay for a share of the institutional cost of research. The F&A cost component is distinct from the direct cost award, and in theory it simply reimburses the institution for the real cost to the college of conducting research.

To date, Babson College has used the salaries and wages method for calculating F&A rates. Our current rate is 59% applied to a base of salaries and wages. Federal laws and regulations require that the approved F&A cost rate be applied consistently. When preparing a sponsored project budget to the federal government, the approved F&A cost rate should be used unless the sponsor limits the rate by statute and/or policy. Examples of government agencies which limit rates are USDA and U.S. Department of Education.

When submitting proposals to private foundations, a minimum F&A rate of 15% on Total Direct Costs (TDC) will be proposed. Some foundations have published policies specifying reduced or no F&A cost allowance. There may be instances when a faculty member feels it is in the best interest of the college to submit a proposal to a foundation or other sponsor that does not allow F&A reimbursement or allows less than 15%. For example, a project could have significant intellectual or educational benefits to the college that outweigh the loss of F&A reimbursement. In such instances, the faculty member should discuss the proposal with the Provost and obtain written or electronic approval sent to CFGR from the Provost and the Vice President of Finance before proceeding with the proposal.

Cost sharing on a sponsored program is when the institution agrees to fund a portion of the project with its own funds or with funds from a third source.

Some important points in the government’s cost sharing policy are listed below:

• Consistent with OMB Circular A-110, cost sharing is synonymous with the term “matching;”
• Cost sharing should be used with reference only to quantifiable and auditable contributions from non-federal supported activities;
• In the case of in-kind contributions, a quantifiable and auditable value must be established;
• Required cost sharing is an eligibility criterion, not a review criterion
• Unless a program solicitation specifically requires cost sharing, proposers should not include cost sharing amounts in the budget, and should not exceed the level or amount specified in the solicitation.

Cost sharing or matching on any sponsored project could be very costly and must be carefully evaluated before committing the college’s resources. Therefore, any cost sharing or matching requirements should be approved by the Provost and the Vice President of Finance before any faculty member begins the proposal process.